The Associated Press distributed a story yesterday claiming that a surface transportation bill would not necessarily create jobs, but instead shift investments that are already creating jobs to the transportation industry. However, money invested in essential public works can create thousands jobs across the nation, provide for economic growth, and ensure public safety.
The nation’s transportation infrastructure system has an annual output of $120 billion in construction work and contributes $244 billion in total economic activity to the nation’s gross domestic product (GDP). In addition to the economic benefits, the Federal Highway Administration estimates that every $1 billion invested in the nation’s highways supports 27,823 jobs, including 9,537 on-site construction jobs, 4,324 jobs in supplier industries, and 13,962 jobs throughout the rest of the economy. While Standard and Poor’s has stated that highway investment has been shown to stimulate the economy more than any other fiscal policy, with each invested dollar in highway construction generating $1.80 toward the gross domestic product in the short term.
In July 2011, ASCE released an economic study that measures the potential impacts to the economy in 2020 and 2040 if the nation maintains current levels of surface transportation investments. The study, Failure to Act: the Economic Impact of Current Investment Trends in Surface Transportation Infrastructure, found that if investments in surface transportation are not made in conjunction with significant policy reforms, families will have a lower standard of living, businesses will be paying more and producing less, and our nation will lose ground in a global economy.
Furthermore, the study found that the nation’s deteriorating surface transportation will cost the American economy more than 876,000 jobs, and suppress the growth of the country’s GDP by $897 billion in 2020. The results also estimate that more than 100,900 manufacturing jobs will be lost by 2020 and that ultimately Americans will get paid less. In contrast, a study from the Alliance for American Manufacturing shows that roughly 18,000 new manufacturing jobs are created for every $1 billion in new infrastructure spending.
The nation’s economic health is dependent on a strong infrastructure system. By updating, maintaining, and building our roads, bridges, and transit systems, the nation can create jobs in both the public and private sector, while fostering and growing the United States economy. Therefore, the first step toward a modernized transportation system must include passing a multi-year surface transportation authorization. With the Senate slowly working through a series of non-germane amendments to MAP-21, and the House reassessing their next steps after pulling the American Energy and Infrastructure Jobs Act, surface transportation programs continue to face an uncertain future. ASCE hopes that the House and Senate can find a solution and pass legislation in the 112th Congress. In the meantime, surface transportation programs will be subjected to another extension, while American jobs hang on the line.
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Is the “job creation is relatively unimportant” or not given other “significant benefits”?
Safety does not get mentioned in the AP story. That would seem to be more significant than just improving infrastructure systems or getting people & goods around more quickly.
Seemingly there is a connection with infrastructure investment and jobs, that is clear. Are the jobs long term or short term, make work jobs? President Herrmann has a recent blog post titled: Good Engineering Is Never ‘Penny Wise and Pound Foolish’ which strikes me as a relevant consideration.
Issues such as 1) a bridge to no where, 2) shovel ready projects, and 3) “non-germane amendments” to legislation all work against good engineering decisions/good infrastructure investments. The sentiment of economists of the AP article and from what I hear of some folks where I sit outside the DC beltway seems rather consistent, the infrastructure spending is not worth the money, the value is not clear.
Can anyone feature some state, region, or local community where infrastructure investments have paid off?
Can jobs attributed to any of the federal “stimulus” bills be used to substantiate this blog, infrastructure investment creates jobs? I would have expected jobs created by “stimulus” bills to be an obvious way to support jobs from more infrastructure investment, if that did occur.
212,107 jobs
http://www.recovery.gov
indicates this number of jobs in the 4th Quarter of 2011 due to “recovery” funds.
You can search for funds & jobs etc. by state, zip, city and many other factors.
There are three main breakdowns: tax benefits; contracts, grants, & loans; and entitlements.
Of the contracts, grants, & loans, the categories most relevant to ASCE – civil engineering would seem to be
transportation, $33.5 Billion
infrastructure, $25.9 Billion
energy/environment, $23.5 Billion
sum = $82.9 billion out of $840 Billion for American Recovery and Reinvestment Act.
OK, as a participant in the ASCE Legislative Fly In this week, I can identify local infrastructure projects to elected officials (most likely their staff members).
I can identify some resurfacing projects around town. However, MAJOR infrastructure is a miss with stimulus funds in my neighborhood/town – a strike as there are MAJOR needs for combined sewer work – but resurfacing was more shover ready I guess.
The downtown fire station is getting renovated and the city government building, a renovated old department store & office building, got some energy efficiency upgrades. It is unfortunate that more visible projects are not apparent. There certainly is the need.
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